NEW YORK (Reuters) - Nearly six times as many U.S. shoppers say they will cut back on gift-buying this holiday season than those who plan to spend more, according to a Reuters/Zogby poll released on Wednesday.
The poll results were bolstered by a forecast from research firm TNS Retail Forward. In the gloomiest holiday forecast yet, TNS said it expected a mere 1.5 percent growth for holiday fourth-quarter retail sales, the worst in 17 years.
Consumers pressured by high fuel prices and a U.S. housing slump are focusing on paying only for essentials and cutting back discretionary items like extra clothes and gifts.
Growing fears over the health of Wall Street since investment firm Lehman Brothers filed for bankruptcy protection and the U.S. government agreed to rescue insurance giant AIG this week will likely strike at consumer confidence even further.
More than 44 percent of people surveyed by the monthly Reuters/Zogby poll last week said they will spend either a little less or a lot less on gifts this year than in 2007.
Forty-six percent said they would spend about the same and just over 7 percent said they would shell out more.
“This a staggeringly bad number,” said pollster John Zogby, referring to the number of people who said they would spend the same amount on gifts this year. He noted that with inflation, even flat sales means retailers won’t be making as much.
“You’re still going to have people standing in line at three in the morning at Wal-Mart, but the lines may be thinner this year” on Black Friday, he said, referring to the day after Thanksgiving in late November that kicks off the holiday sales season with a barrage of promotions.
With 2008 likely to be the third consecutive holiday season of flat sales, Americans may even be moving away from emphasizing expensive holiday purchases after years of heavy spending placed on credit cards, Zogby said.
“Some are expressing the holidays in nonmaterial terms, and others are flat-out saying, ‘I just don’t have the money,’” Zogby said. “But there’s enough of a trend here over the last at least 3 years to suggest that this is larger than this slowdown.”
Mid-priced department stores like J.C. Penney and Kohl’s have warned investors they don’t expect sales to improve until the second half of next year at the earliest.
Even affluent shoppers have started to scale back spending as they lose confidence in their stock portfolios, hurting luxury retailers like Saks and Nordstrom.
The Reuters/Zogby poll follows a Deloitte report on Tuesday predicting this holiday season could be one of the weakest in the United States in nearly 17 years.
Deloitte forecast that holiday retail sales, excluding motor vehicles and gasoline, will rise 2.5 percent to 3 percent, less than last year’s 3.4 increase and potentially one of the smallest gains since a 2 percent rise in 1991.
TNS said it expects Wal-Mart and Target to see 6 percent growth for the holidays, as consumers shift toward discount stores, with sales of apparel and accessories dropping 1.3 percent, compared to flat growth last year.
One bright spot is online sales, which TNS forecast to grow 9 percent this holiday.
The Reuters/Zogby telephone survey of 1,008 people, conducted from September 11-13, carries a margin of error of 3 percentage points.
Editing by Richard Chang and Gunna Dickson